Fraud Prevention and Detection

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17

Screening, Scrutinizing,

and Investigating Red Flags

INTRODUCTION

When it comes to fraud, even the most well- prepared and -structured orga-

nization can become a victim. There is no silver bullet—no single, magical

solution—that can safeguard even the most prudent of us from fraud.

However, the prudent measures outlined in this book—collectively

called the Red Flag System—can help reduce the risk of fraud and increase

the chances that it can be either prevented or detected much earlier.

As we have outlined, the Red Flag System is practical, effective, and

empirically tested. It is based on the premise that to prevent fraud success-

fully or to detect it as quickly as possible after it begins, an organization

must have the capacity to identi ...